What Is Earnings Per Share (EPS)? Meaning & Example
Definition
Earnings per share is a company's net profit divided by its number of shares outstanding. It shows how much profit is attributed to each share.
Related terms
The price-to-earnings ratio divides a company's share price by its earnings per share. It shows how much investors pay for each dollar of profit.
Earnings ReportAn earnings report is a company's regular update on revenue, profit and outlook, often released quarterly. Results versus expectations can move the stock sharply.
Payout RatioThe payout ratio is the share of a company's earnings paid out as dividends. Very high ratios can mean the dividend is hard to sustain.
What is Earnings Per Share (EPS)?
Earnings per share is a company's net profit divided by its number of shares outstanding. It shows how much profit is attributed to each share.
Can you give an example of Earnings Per Share (EPS)?
A company earning $10 million with 5 million shares has EPS of $2.